Major Bank's Short Sales Outpacing Sales of Foreclosures

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In the pecking order of risky real estate transactions, homebuyers are usually most wary of short sales, which are notoriously more complicated than foreclosures. But with some key revisions to the Home Affordable Foreclosure Alternatives (HAFA) program in April, short sales could suddenly become more accessible to both banks and buyers. Could HAFA change the stigma attached to short sales and finally cut down on America's distressed home inventory? HousingWire has the full story.

For every month in the last year and a half, Bank of America has completed more short sales than it has sold previously foreclosed home.

In May, BofA completed roughly 9,000 short sales compared to 7,000 REO, said David Sunlin, the bank's real estate management executive. With the introduction of the Home Affordable Foreclosure Alternatives program in April 2010, lenders received the first guidelines for these transactions.
Since then, banks find it easier to collect necessary documentation and reduce the time it takes to close these transactions. Recent guideline changes to HAFA could push numbers higher in 2011.

BofA completed more than 95,000 short sales in 2010, more than double the prior year, Sunlin said.

"HAFA is dead on. It's a lot easier to qualify now for HAFA than it was in 2010. All I need is a hardship affidavit and one water bill. We're trying to make it as easy as possible," Sunlin said.

Justin Rand, Citigroup senior vice president of loss mitigation, said his bank used to take an average 120 days from when the property was listed to when it closed. That's since dropped to 83 days.

Read the full story on HousingWire.

For more insight on short sales, mortgages and related topics, see these AOL Real Estateguides:

More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
Find foreclosures in your area.
Get property tax help from our experts.



More on Short Sales:
Understanding Short Sales
How To Sell Your Home in a Short Sale
VIDEO: All About Short Sales


More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
Find foreclosures in your area.
Get property tax help from our experts.

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